1. Understand Sales, Consumer, Property and Cyber Laws
Objective 6.02
PROPERTY LAW
Bailments

2. Bailment
An agreement created by the temporary delivery of personal property by the owner to someone who is not the owner for a specific purpose.
Both parties agree that the property will be returned to the bailor.
Bailee - has in their temporary possession property that belongs to someone else.
Bailor – owner of property who gives up possession to someone else temporarily.
Custody – person may have custody of an item and not become the bailee. A bailment has not been formed. None of the artwork was left with the guard specifically. Peter was hired by the school to protect the artwork not the owners of the artwork.

3. Bailment If John leaves his i-Phone at XYZ repair shop for a week?
Who is the Bailee?
Who is the Bailor?
There is an art show in the gym this weekend. Peter is hired to spend the night in the gym and protect the artwork.
Why would this not be considered a bailment?

4. Examples of Bailments Leather jacket left at a dry cleaners
Vehicle delivered to parking valet
Goods transported by common carrier
Truck taken to dealership for service check
Diamond ring taken to jeweler for cleaning or repair
Leaving your clothes in dressing room while trying on new sweater
Goods delivered to a consignment shop

5. Mutual Benefit Bailments
Invokes the duty of ordinary care on the bailee
Results from a contract (for service, repair, storage, rental) with consideration exchanged
Both bailor and bailee receive benefit
A pledge as security for a loan is also a mutual benefit bailment
Most bailments are mutual benefit

6. Bailment by Necessity
Implied by law, a customer must give up possession of property.
Example: When you rent skates and leave your own shoes while you skate
Example: When you leave your clothes temporarily in the dressing room while you try on a new outfit

7. Other Bailments Gratuitous Bailment Extraordinary Bailment
Free of charge (lend something to a friend).
Only one party benefits
Extraordinary Bailment
A common carrier or hotel is strictly liable for damage to bailed goods
Involuntary Bailment
Arise accidentally
Example – anytime your find someone else’s property. Discuss that minimal care is expected. You should not destroy property while it is in your care.

8. Rights and Duties of Bailee
To hold a Mechanic’s Lien -the right to retain property of another, if not paid for service rendered
To expect payment for services rendered
Duties:
Of reasonable care and protection of goods while in custody of bailee
To comply with terms of bailment

9. What if? What if you refuse to pay for car repairs that you approved?
Can the mechanic keep your car?
Yes
Can you call police and say he stole your car? No
Can the mechanic charge you a storage fee even though he won’t return your car?
What if you refuse to pay for car repairs that you did not approve
You do not have to pay for repairs and he cannot hold your car.

10. Rights and Duties of Bailor
to have goods protected
to receive service as agreed upon
to have goods returned in timely manner
Duties
to pay for service provided
to warn of dangers or special care required
to pick up goods in a reasonable time

11. What if? Ethics and the Law:
What if a student who finds necklace and knows who it belongs to but does not return it to the rightful owner?
What if a parking valet who takes your hot car on a joy ride?
What if a dry cleaner’s employee who wears your leather jacket out on a date?
BB30 Business Law 6.02 Summer 2013

12. Tortious Bailee What is a tortious bailee?
A party who wrongfully retains lost property or stolen property
A party who wrongfully uses a bailed article for a purpose other than that agreed upon by the parties
Examples:
Student who finds necklace and knows who it belongs to but does not return it to the rightful owner
Parking valet who takes your hot car on a joy ride
Dry cleaner’s employee who wears your leather jacket
WORKSHEET:
Bailments
Vocab & Scenarios